WikiLeaks Plus Fed Disclosures Are Data Overload: Amity Shlaes

Dec. 3 (Bloomberg) -- The phrase information overload has
taken on new meaning.

Last weekend WikiLeaks.org released about 250,000
classified U.S. State Department cables. Within days the
collective American brain was challenged by another info-dump.
On Wednesday, the Federal Reserve posted the details of more
than 21,000 of its transactions with financial firms and other
businesses during the financial crisis, in an unprecedented move
required by the new Dodd-Frank law overhauling financial
regulation.

The first question prompted by this document flood is
whether releasing such previously unavailable information is
right or wrong. Most Americans probably feel unqualified to make
this call. The second question, equally important, involves
efficiency. How is this quantity of material to be sorted out,
and does the old news industry still play a role in that work?

In 1971 Daniel Ellsberg needed the New York Times to
disseminate the Pentagon Papers, a critical analysis of the
Vietnam War. A short time later, Bob Woodward and Carl Bernstein
needed the platform of the Washington Post to deliver a long,
complex story like Watergate, and to give their combination of
innuendo, surmise and fact a layer of legitimacy.

Today, it’s different. If the contest is about the sheer
volume of material, newspapers and magazines have already lost.
The ocean of information that WikiLeaks and its heedless founder
Julian Assange have released makes the 7,000 pages of the
Pentagon Papers look like a New England pond. It turns out
places without multilayer hierarchies, marketing departments or
editorial picnics are able to find readers if their material is
juicy.

Looking for Guideposts

There is a simple way to decide the matter of right and
wrong. Disclosure is fine insofar as it is legal. It’s time to
respect the law and use it as a guidepost.

The original leak of cables was clearly illegal. The data
allegedly flowed to WikiLeaks from Bradley Manning, a private in
the U.S. Army, who is suspected of disseminating classified
information. Criminal charges against Manning are likely to
include violating Article 92 of the Uniform Code of Military
Justice, which says that any soldier who “violates or fails to
obey any lawful general order or regulation” shall be punished
“as a court martial may direct.” Manning may also be charged
with violating Article 134, which covers “disorders and
neglects to the prejudice of good order and discipline in the
armed forces.”

Assessing Damage

An efficient response is to assume those laws exist for a
reason, and if Manning violated them, he should be punished. The
guessing game about how much damage the leaks might cause was
already evaluated, by the authors of such laws. And unless the
guilty party -- Manning or someone else -- is convicted, copycat
leaks are likely. Those leaks could contain damaging
information, even if the current set of leaked cables don’t.

Therefore, the perpetrator, whoever he is, deserves to be
condemned. If Interpol or any other law enforcement institution
can prove that Assange’s WikiLeak activity is illegal, then he
should face the consequences, too. The flamboyant Assange,
though, is mere handmaiden to whoever leaked the material.

The Fed situation is different. The central bank, at least
early on, wasn’t any happier to disclose data than the State
Department. Bloomberg News reporters sought for years, first
through Freedom of Information Act requests, then through a
lawsuit, to get the Fed to be more transparent about its bailout
activities. Fed officials refused.

Changing the Rules

Meanwhile Congress passed the Dodd-Frank law in July, which
mandates the Fed to disclose its decisions about whom to rescue,
and how. The most unfortunate aspect of this provision is that
it’s retroactive. Those who received financial help assumed
details of the transactions wouldn’t be published. From now on,
those who approach the Fed will know better.

Still, there is room for Congress to change the law. When
it comes to the question of the old media’s future, the law, or
ethical culture in a larger sense, is also a good guideline.

Let’s face it: Assange’s arrogance recalls the less
attractive side of Woodward and Bernstein. At times journalists
of the post-Watergate investigative variety have used their own
non-transparent, sometimes illicit, methods such as promises of
anonymity and bullying to squeeze information out of officials.
Crusading reporters justified their modus operandi by telling
themselves that only they could deliver such valuable
information.

Age of YouTube

It turns out that disgruntled servicemen or bank executives
don’t need newspapers. They don’t even need WikiLeaks. All they
need is YouTube.

The information flood doesn’t necessarily doom news
institutions. Having lost the race to the bottom to Assange and
others, the news media will have to compete by adding value in a
more dignified way, by honoring a more noble aspect of the
“Woodstein” legacy. This includes using legal channels such as
FOIA requests to enlighten.

The news industry’s greatest advantage lies in its most
experienced members. There is a certain kind of person who is
able to efficiently sift through a flood of information, pulling
out nuggets that matter and presenting them in a compelling way.
That person is called an editor. Eventually his revival will be
commanded, not by colleagues, but by the information-swamped
market.

(Amity Shlaes, senior fellow in economic history at the
Council on Foreign Relations, is a Bloomberg News columnist. The
opinions expressed are her own.)